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Fail to file your Costs Budget at your peril

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Further warning has been received from the courts that the new post Jackson era of strict compliance with the rules is here to stay; it would certainly appear that excuses that may have washed prior to 1st April certainly won't carry much weight now.

Readers are sure to remember the infamous 'Plebgate' scandal of September 2012; Andrew Mitchell was accused of swearing at police officers at the entrance to Downing Street, the story gained significant media interest with Andrew Mitchell resigning from his post as Government Chief Whip.  Mr Mitchell subsequently sued News Group Newspapers for libel; the case is continuing.

However, Mr Mitchell’s lawyers failed to file a costs budget 7 days prior to the CMC as required by the rules.  On 18th June 2013 Master McCloud limited the claimant’s costs budget to court fees only. The claimant applied for relief from sanctions.  Costs Counsel were instructed for both parties and on 1 August Master McCloud dismissed the application; the Claimant’s reason for the failure to file its cost budget was due to staffing issues and work pressures; the Claimant’s solicitor practice was a small one with just 2 partners.  Master McCloud said this was not enough of an excuse:

“The explanations put forward by the claimant’s solicitors are not unusual ones.  Pressure of work, a small firm, unexpected delays with counsel and so on.  However, even before the advent of the new rules, the failure of the solicitors was generally not treated as in itself a good excuse and I am afraid that however much I sympathise with the claimant's solicitors, such explanations carry even less weight in the post-Jackson environment.”

Interestingly the Claimant had only been given very short notice of the CMC - 4 days including a weekend; Master McCloud considered whether the Claimant had been given enough time to prepare the budget and said:

“The parties were well aware that this was a case for which budgeting would be required from the start and that the mere fact that a date is set for a CMC is not supposed to be the starting gun for proper consideration of budgeting.”

Further, she noted that cases such as these resulted in some claims taking unfair amounts of judicial resources:

"Judicial time is thinly spread, and the emphasis must, if I understand the Jackson reforms correctly, be upon allocating a fair share of time to all as far as possible and requiring strict compliance with rules and orders even if that means that justice can be done in the majority of cases but not all.”

Clearly the Master had some sympathy for the claimant in that she granted permission to appeal of her own motion.

“The stricter approach under the Jackson reforms has been central to this judgment. It would have been far more likely that prior to 1/4/13 I would have granted relief on terms, and in view of the absence of authority on precisely how strict the courts should be and in what circumstances, I shall grant permission to appeal to the Claimant of my own motion…It will be for the appeal court to determine whether such a strict approach is appropriate.”

It would seem likely, that in this new era of 'no second chances' that there is little prospect of the Court of Appeal overturning the decision.  We would urge all lawyers with multi track claims to commence their preparation of the cost budget as soon as possible.

Full details of the judgement can be found here: Andrew Mitchell MP v News Group Newspapers [2013] EWHC 2355 (QB)